New measures were introduced on Saturday to curb speculation in the real estate market.
As such, all residential properties purchased on Saturday and sold within a year will be imposed with a Seller’s Stamp Duty, while home loans from financial institutions will be capped at 80 percent of the property value.
However, despite new measures announced, business at one property showroom proceeded as usual, as a steady stream of home buyers checked out the units available.
Sales of units at the Altez condo, located just opposite Tanjong Pagar MRT station, are moving fast.
One woman in her 30s purchased four units – two to rent out and two to stay in.
According to the developer of the condominium, they could still sell an entire floor of units within an hour.
The reduction in the limit of home loans did not make much of a difference, according to some home buyers.
“The banks have been very strict, anyway. So I think we will still be on track for our financing,” said Raphael Tan, one home buyer.
The new Seller’s Stamp Duty does not pose any concern to those who are buying for the long-term.
“Although it’s quite pricey now, I think this is a good location and for long-term investment,” said Doris Chia, another home buyer.
Analysts expect that developers will launch more properties in the high-end segment of the market during the first half of this year.
These high-end properties usually sell at $2,000 psf and attract investors and buyers who are not overly conscious of the prices.
“A lot of the high-end investors are typically not bound by any limitation. They don’t go for maximum loan-to-value ratio. In some cases, they just go for 40 to 50% of loan-to-value ratio. In some cases, they even buy on a cash basis,” said Donald Han, managing director of Cushman and Wakefield.
According to the analysts, the mood to acquire will not change that much, as the measures are intended to get rid of speculators, who comprise a small percentage of the market.
Meanwhile, Grace Fu, Senior Minister of State for National Development, said that now is the time to introduce measures to cool the private property market.
She also said that the authorities have been monitoring the property market closely and it is best to introduce the measures before the property bubble forms.
"We would think that it may deter speculative buying and we want our investors to basically be on more solid ground when they invest in properties. It should not deter genuine buyers who have the financial resources to hold the property."